An eyesore former bed shop in Lancaster will be converted into 24 student flats after councillors gave the scheme the go-ahead despite objections from neighbours.
The development at Oddfellows Hall on Brock Street was granted planning permission on Monday during a meeting at Morecambe Town Hall.
The boarded-up former Bensons for Beds has long been regarded as one of the city centre's biggest eyesores.
The plan is to convert the upper floors into four cluster flats and 20 studio flats, as well as dormer roof extensions. The ground floor will remain as a shop unit.
The studios will have a dedicated entrance off Mary Street with a new internal staircase and lift to serve the upper floors.
Oddfellows Hall was built in 1844 as a meeting room and residential accommodation.
There were some objections from neighbouring businesses.
Anas Mister of Unipad Management Ltd, speaking at the meeting on behalf of the nearby Virgin Money, The Hanging Basket and Greggs, said "this application falls short and will likely create further issues".
"Put yourselves in our shoes and consider how you would feel if this development was proposed next to your home or business."
Mr Mister said that an all-studio flat scheme would have been preferable, and said there were concerns that a proposed bins and bike store would obstruct the right of way to the neighbouring properties through a narrow back alley.
But David Morse of Baltic PDC, speaking on behalf of the applicants, said they felt the scheme would "promote the vitality and viability of the wider high street".
"It is clear (planning officers) have taken into account the neighbours' concerns," said Mr Morse.
Lancaster City Council planning team had recommended the scheme be approved.
Mark Potts, planning officer, said: "It's been nice to see a proposal come forward to bring the building back into use."
Mr Potts also said the width of the alleyway was "on the cusp of acceptabilty" but the issue of access "can be mitigated" and that the council could ensure bins were being collected and not "left forever and a day".
However, Councillor Dave Brookes, of the Greens, said: "It does provide a lot of benefits and it is good to get this building back into use after such a long time of being an eyesore and taking up such a huge part of the street.
"But I receive a lot of complaints about student bin spills in the city centre. They are a complete nightmare.
"I'm very concerned that this is not an appropriate layout."
But most councillors on the planning committee were in favour of the scheme.
Councillor Sally Maddocks, of the Greens, said: "It's on a knife-edge. I agree the back alley is problematic but we have conditions (on the planning permission) and an enforcement team. On balance I'm going to support it."
Councillor Martin Bottoms, a Morecambe Bay Independent, said: "Most high streets are run down and here we have a building standing empty, that we need to bring back into use. I particularly like the retail on the ground floor."
A vote was taken, with Councillors Thornberry, Tyldesley, Maddocks, Budden, Bradley, Hanson, Greenwell, Tynan, Pritchard, Lenox, Bottoms, Gawith and Cozler voting in favour of granting planning permission. Councillors Brookes and Redfern abstained.
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